McDonald's Holdings Company(Japan),Ltd. (2702) Q2 2026 Earnings Call Transcript

Minasama, Konnichiwa. Thomas Koldas. Thank you very much for taking time out of your busy schedules to join our online financial results briefing today.

Before I begin today's presentation, I would like to express our heartfelt sympathy to all those affected by the recent Kumamoto earthquake. quick. We sincerely hope for a swift recovery so the people of the region can return to their normal lives as soon as possible. In the affected areas, our franchisees are working diligently toward reopening restaurants, with the safety of our customers and crew members as the highest priority. I would like to express my sincere respect and gratitude to everyone involved in these recovery efforts. I would also like to thank our suppliers for their tireless efforts to maintain a stable supply of products during this challenging time. As part of our support for the affected communities, we are making a corporate donation and conducting fundraising activities at McDonald's restaurants across Japan. Through these efforts, we hope to deliver the support and goodwill of the McDonald's family and our customers nationwide to those impacted by the disaster. Especially in times like this, we are committed to provide every possible support, guided by our three-later stew philosophy so that franchises, suppliers, and a company can work together to enable our restaurants to continue to serve their local communities and contribute to the region's recovery. I'll begin by presenting the highlights of our financial results for the first half of 2026. System-wide sales were 464.3 billion yen Up 8% year-on-year With an increase in same-store sales of 5.9% This achievement marks positive growth for 43 consecutive quarters Since Q4 2015 Restaurant development is progressing in accordance with the medium-term management plan, with steady optimizations of the restaurant portfolio. We believe this growth is a result of our continued efforts to enhance the customer's experience, listening to feedback, improving QSCs and convenience, and actively investing in marketing, restaurants, and our people. These efforts have been well-received by a growing number of customers. These achievements will be made possible by the efforts of everyone who supports McDonald's, including our own operators, suppliers, restaurant managers, restaurant staff, crew members, and all those involved in the McDonald's system. I'd like to thank you from the bottom of my heart. With the ongoing inflation in ingredients, energy, and labor costs, we implemented price revisions in February 2026 so that we could continue offering restaurant experiences that satisfies our customers. As same-store sales have remained solid following the revisions, we believe our efforts to deliver value beyond price are resonating with customers. We'll keep meeting our customers' expectations for taste, quality, hospitality, speed, and delivering value beyond price so that customers continue to choose McDonald's. Now, Mandae-san will brief you on the details of our earnings results for the first half of 2026.

CA4の問題でございます よろしくお願いします ご覧になっていただいているのは 上半期の業績概要になります 前転売上高は4643億円 前年同期費でプラス8% 既存転売上高は前年同期費プラス5.9%となりました また営業利益は主に好調な売上により302億円 前年同期費でプラス15.2%となりました It is the same time, in March and August, in the end of the second quarter, on March 1, and the price of the time chain times, the market and the money loss of the cost, and the amounting price and the price of the材料 cost, which has to pay attention to do the list, on the other hand- CIата, so that the price gives us the worldwide cost. That's how you can see it. Next, I'll explain it. The price of the price is $345,000. The price of the portfolio is $345,000. 新規の出店が35店舗 閉店22店舗で 前期末比でプラス13店舗となりました 既存店の増収に加え 戦略的な出店 閉店により より広く効率性の高い 店舗へ入れ替えることによって お客様のご利用機会を増やし 全店売上高を 伸ばしております 右側には既存店売上高とお客様数 前年同期費を示しております。 第1四半期は主に期間限定のプロモーション商品が皆様のご好評いただいたことで、既存店のお客様数は高い水準となりました。 第2四半期も月単位での増減こそありますが、売上高、お客様数ともに前年同期を上回りました。 価格改定後もお客様の利用は底堅く推移していると評価しております。 今後もお客様の動向を注視しながら価格以上の価値を感じていただけるよう取り組んでまいります。 続いて上半期の営業利益の変動要因についてご説明いたします。 上半期は前年売上高の増加が営業増益に大きく貢献しました。 マーケティングや店舗人材への投資が売上成長につながっています。 On the other hand, the price of原材料価格や 人件費などの店舗運営コストは 上昇が続いております 特に牛肉を中心とした原材料価格の上昇は 利益の圧迫要因となっておりまして フランチャイズオーナーの キャッシュフローにとっても 大きな負担となっています 原材料価格は当初想定よりも悪化し 下半期はさらにその影響が 大きくなる見込みです 価格改定は収益性維持に 一定の効果をもたらしておりますが 人件費などの店舗運営コストは上昇が続いております 特に牛肉を中心とした原材料価格の上昇は利益の圧迫要因となっておりまして フランチャイズオーナーのキャッシュフローにとっても大きな負担となっています 原材料価格は当初想定よりも悪化し下半期はさらにその影響が大きくなる見込みです 価格改定は収益性維持に一定の効果をもたらしておりますが 店舗運営コストの上昇を全て相殺できるものではないと考えております この状況に対し店舗オペレーションの効率化やグローバルネットワークを生かした物流の効率化 仕様の見直しなど品質と安全を最優先にしながらマクノラルドシステム全体でコストの最適化を進めてまいります

Let me update on where we are in a second year of our medium-term management plan. To continue being the most beloved restaurant brand in Japan, we aim to achieve further growth through strengthening and expanding our franchise business that is rooted in the community. As specific growth strategies, we are focusing on the three areas of menu and value, restaurant portfolio and digital, and sustainability and people. I'll explain our activities from the first half of the year in the following slides. First, to start with menu and value, alongside our popular call menu items that enjoy broad support across generations, we have introduced engaging promotions featuring seasonal and topical themes, while implementing initiatives that enable customers to connect more closely with the McDonald's brand. This February, we implemented price revision to enable our franchises and company-operated restaurants to continue making proactive investments despite the cost pressure they are facing. Meanwhile, we have continued initiatives that offer a sense of value, such as Hero Mac, Z500, and Tukuni Narado. To meet the needs of a broader range of customers and cater to a variety of dining occasions, we are working to offer limited menu items that bring a sense of seasonality and fun to our customers for each of the four seasons here in Japan. In addition to our standard menu items, unique to McDonald's. Since June, as an official sponsor and restaurant partner of the FIFA World Cup, we provided special experiences for customers to enjoy before and after matches, as well as moments to share with family and friends. We have also placed a focus on menu items by day part, creating occasions for customers to visit our restaurants throughout the day. These initiatives demonstrate that McDonald's is more than just a place to eat. We are a brand that delivers enjoyment and meaningful experiences in our customers' everyday lives. We believe this needs to increase the visit frequency and has helped us remain a brand of choice for our customers. Next is restaurant portfolio and digital. Looking ahead, upgrading our restaurant portfolio is essential to further enhancing the restaurant experience for both customers and crew. Customer preferences have become increasingly diverse, with more ways to enjoy McDonald's, including counter service, drive-thru, delivery, and mobile ordering. Designing restaurants that respond to these changing preferences not only enhances customer experience, but also helps create a more comfortable and efficient crew working environment. For these reasons, we view restaurant investment as a key long-term growth driver and have continued to make these investments in a disciplined and planned manner. The medium-term management plan targets 100 net new restaurants and 1,000 restaurant remodels over the three-year period from 2025 to 2027. Progress is largely in line with plan. During the first half, we opened at 35 new restaurants and closed at 22. Our restaurant replacement strategy is advancing smoothly and we are making steady progress towards building an optimal restaurant portfolio. Remodeling is also moving ahead largely as planned. When we expand restaurant capacity, introducing touch panel ordering terminals and switch to a more efficient layout, we are creating restaurant environments that are more comfortable for customers and easier for crew. Remodeling is not about boosting short-term sales. It is a growth investment designed to ensure we continue to provide customers with a better restaurant experience over the next 10 years. Going forward, we will steadily carry out new restaurant launches and remodeling to enhance profitability and restaurant experiences, while carefully monitoring each restaurant's trade area, capacity, and investment efficiency. In digital, the proportion of customers using mobile ordering and delivery to place order is increasing steadily. In addition, with the expansion of our digital member base, such as MyMcDonalds Rewards, our connections with customers are growing deeper. The use of digital not only improves convenience for customers but also leads to more efficient restaurant operations and the ability to offer suggestions tailored to each and every customer. Going forward, by combining digital with the heartfelt hospitality of our crew, we will continue to deliver an even better restaurant experience for our customers. Now, our report on sustainability and people. We continue to advance initiatives to reduce the use of virgin plastics. Strawless leads have been rolled out across all restaurants, while nearly all restaurants have moved to take away bags made from biomass materials. Our sustainability initiatives not only reduce environmental impact, but also help control restaurant operating costs. For example, through the replacement of air conditioning systems at company-operated restaurants in 2025, we achieved an approximately 10% reduction in their electricity usage. usage. In this way, we will continue to steadily pursue initiatives that fulfill our environmental responsibilities, while achieving sustainable business growth. Last is people. People are the foundation of McDonald's business, and we continue to focus on enhancing engagement. We believe that providing the best employee experience is a critical objective, as it underpins everything we do. Employee satisfaction continues to remain high. We believe this is the result of our ongoing efforts to create an environment where our crew can thrive, including digital learning and training programs, flexible work schedules, and improvements to the restaurant work environment. In crew hiring, the number of applications has continued to increase compared to the previous year. Going forward, we will continue to provide growth opportunities for all employees and strive to create an even more inclusive and supportive workplace where everyone can thrive. McDonnell has grown through its franchise business. Our owner-operators have a keen understanding of the customers and crew in their areas, and are conducting business that is deeply rooted in the community. This is one of the main reasons McDonnell continues to be loved across the country. Today, our business is operated by more than 200 owner-operators, and our franchise restaurant numbers and owner-operator numbers are steadily increasing. Our franchising strategy does not aim to simply increase the number of franchise restaurants. As with our existing owner-operators, we expect new owner-operators to uphold McDonald's high standards of quality and operate restaurants that are deeply rooted in their local communities. The key is to enable these qualified owner-operators to steadily operate and expand their businesses. Company-operated restaurants also play an important role, such as developing talents, accumulating know-how in restaurant operations, and verifying new initiatives. While carefully assessing the characteristics and growth potential of each restaurant and trade area, as well as business circumstances of our owner-operators, we will strengthen and expand our franchise business at an appropriate pace. That concludes my remarks. Next, Mandai-san will explain our full-year earnings forecast for fiscal 2026, along with our growth investments and shareholder returns.

Yes, I will explain what we will explain about the year-to-year earnings forecast for fiscal 2026, along with our growth investments and shareholder returns. 下半期については、牛肉を中心とした原材料価格の上昇が基礎の想定を上回る見込みであり、為替についても依然不透明な状況です。 This is a model for marketing. As you start with the market, I think it will work well as the market has been planned. This is the situation in the past, but over the past, this is the model for their best-hearted and good luck. This is the model for our best-after-after-after-after-after-after-after-after-after-after-after. 引き続き価格以上の価値を提供しながら収益の改善と成長投資を両立させ持続的な成長を目指してまいります 最後に成長投資と株主還元についてご説明いたします 当社は中期経営計画に基づき店舗開発デジタル人材など中長期の売上成長と店舗の収益性向上を支える投資を進めております 2026年上半期の設備投資額は221億円となり通期もおおむね計画通りとなる見込みです 中期経営計画で掲げた営業キャッシュフロー及び投資キャッシュフローはおおむね計画通りの進捗となっており 株主還元についても2027年度にDOEを3%とする目標に変更はございません 今後も成長投資と株主還元のバランスを取りながら企業価値の向上を図ってまいります 以上2026年度第2四半期の決算報告とさせていただきます ありがとうございました